Abu Dhabi’s Mubadala was an early mover in infrastructure among global sovereign wealth funds, with its first investments in the sector dating back more than 20 years.

The firm started taking its first steps in the early 2000s, from investing in domestic midstream oil and gas pipelines through Dolphin Energy, to establishing Masdar, which would become a global renewables giant.

But it is mostly since its 2017-18 revamping, when Mubadala Investment Company was established in its current form from the merger of other entities, that the sovereign wealth fund’s infrastructure ambitions have started to accelerate in earnest. Infrastructure, which 10 years ago was overshadowed by real estate and healthcare within Mubadala’s alternatives portfolio, has boomed to become one of its most important sectors.

Last year, the firm took a step further by moving its digital infrastructure operations into its traditional infrastructure and real estate unit, renaming the division as real assets and signalling a renewed interest in this asset class.

Infrastructure and real estate investments have already grown in importance within Mubadala’s portfolio in the last few years, from around 11% of total assets in 2019 to 17% at the end of 2024, according to the firm’s annual reports.

Considering the firm’s total AUM have also increased, this indicates Mubadala’s real assets have jumped from around USD 25bn to more than USD 55bn during this period.

Now, Mubadala wants to ramp up its investment in infrastructure even further, its head of infrastructure investments and executive director, Saed Arar, tells Infralogic, and it is looking to expand its portfolio in both established and new markets.

“With infrastructure playing such an increasingly vital role in global development, we are aiming to significantly increase our allocation to the asset class in the years ahead,” Arar says.

While Mubadala does not disclose the split between real estate and infrastructure within the real assets division, Arar, who began working with Mubadala in 2006 following a stint as corporate team leader with HSBC Bank, points to infrastructure as a particularly fast-growing area within the portfolio.

“[Infrastructure] sits at the centre of Mubadala’s mandate to invest in sectors that enable long-term economic progress while delivering stable and sustainable returns for Abu Dhabi,” he says.

Digital and energy transition bets grow larger

Mubadala’s early investments in infrastructure focused on traditional infrastructure assets – such as a stake in Brazil’s Rota das Bandeiras road concession, which it acquired in 2019. It relied on third-party managers for niche areas – for example backing Asper Investment Management’s Dorothea fund for Dutch district hearing in 2020.

But it did not take long for the sovereign wealth fund’s strategy to grow more sophisticated and start targeting new infrastructure sectors.

In 2019 it agreed its first major data centre investment, committing up to USD 500m into US-based Cologix, and in 2020 took a USD 1.2bn stake in India’s connectivity provider Jio Platforms. Soon after it added major bets on fibre, pouring hundreds of millions of dollars into UK fibre operator Cityfibre in 2021, and Nordics player GlobalConnect in 2022.

Moving digital assets within the infrastructure portfolio last year was a natural consequence of this evolution. And jitters in some European fibre markets do not seem to have diminished the firm’s appetite to deploy capital, as shown by a GBP 500m new equity injection in CityFibre in which Mubadala played a major role.

“As we see it, infrastructure investing has entered a new phase,” says Arar. “Infrastructure is no longer defined just as roads, bridges and power plants, but the digital infrastructure, from fibre networks and data centres to EV charging stations that are supporting countries decarbonise and digitalise their economies.”

Mubadala now sees energy transition and digital infrastructure as “high-conviction sectors”, alongside power and transport, as well as “sustainable industrial infrastructure”, according to the executive.

The firm is hardly alone among global infrastructure investors to see new opportunities in this space. But its push into these areas is nevertheless significant, considering the sheer size of its investment firepower – with around AED 1.2tn (USD 327bn) of total assets under management.

Mubadala’s journey into energy transition has followed a more nuanced path, with the firm combining renewables investments with large cheques to more traditional oil and gas infrastructure assets.

Investments in renewables assets spiked in 2022, when it agreed to buy stakes in Global Infrastructure Partners’ (GIP) offshore wind developer Skyborn Renewables and committed USD 525m alongside BlackRock in India’s Tata Power Renewables.

But its interest has continued, with the firm adding investments in UK battery and EV charging operator Zenobe in 2023, and committing EUR 300m to Actis’ Eastern Europe-focused clean power developer Rezlov Energy as recently as December 2025.

In line with the spirit of the times, Arar also points out that Mubadala continues to invest in energy infrastructure linked to oil and gas – including buying a stake in Aramco’s Saudi oil pipelines in 2021 and backing the Rio Grande LNG export project in the US in 2023.

“With gas set to play a critical role as a bridge fuel in the energy transition, [the Rio Grande LNG] investment shows our broader strategy of investing in scalable assets that balance energy security and sustainability,” says Arar.

Geographically, Mubadala has traditionally spread its infrastructure investments across both developed countries such as the US and UK, and emerging markets including India and Brazil.

“We want exposure to mature markets where regulatory frameworks and demand drivers are well established, but also to high-growth regions where infrastructure demand is growing quickly,” says Arar.

For its next deals, the firm wants to “maintain strong exposure” to Western countries but also sees an opportunity to “selectively” expand in Asia, adds the executive.

“In Asia, the combination of economic growth and growing demand for digital and energy transition infrastructure is creating opportunities that fit into our investment strategy,” says Arar.

Domestically, Mubadala also has sprawling investments in energy and infrastructure, but these still sit outside of the real assets group, including its flagship renewables company Masdar and its UAE district cooling platform Tabreed.

Direct, indirect and the credit frontier

Mubadala today mostly deploys capital in infrastructure through direct investments and co-investments “alongside partners we know well”, says Arar, which allows it to be more “hands-on with the assets” and deliver “long-term value”.

This is not to say that it has abandoned indirect investments, which it still uses to target emerging sectors and markets, but also to benefit from “scale and reach” of large GPs. “This mix gives us the right balance,” says Arar.

The executive did not elaborate more specifically on the firm’s indirect investment strategy, but said it looks for “managers who take a disciplined approach to investing and have shown they can perform across different market conditions”, citing a recent cornerstone commitment in a solar power-focused fund of Japanese manager PAG.

One banker with knowledge of Mubadala says that infrastructure credit is a new area that the firm is likely to target next, whether directly or indirectly, following in the footsteps of other large sovereign wealth funds such as Singapore’s GIC, which has a team focused on non-investment grade infrastructure debt.

While Mubadala did not comment on its appetite for infrastructure debt, the firm has indeed expanded its allocation to private credit more broadly over the past few years, with this asset class now accounting for 5% of its AUM.

In the credit space, Mubadala has typically focused on co-investment partnerships with large managers, including KKR, Apollo Global Management and Goldman Sachs – a model it could also pursue for infrastructure debt.

The sovereign wealth fund is also likely to have noticed the expansion of infrastructure credit closer to home more recently. Japanese investor JOIN provided financing to Abu Dhabi’s first energy-from-waste PPP project with a structure “similar to an infrastructure credit” product in 2024, according to a Dubai-based infrastructure executive. More recently in Saudi Arabia, utility developer ACWA Power tapped two infrastructure debt heavyweights, KKR and Barings, to refinance its Rabigh 3 desalination project in December.

“Core+” infrastructure performance

While in 2024 Mubadala posted annualised returns of 10.1% over five years, the firm has not disclosed specific return figures for its infrastructure or real assets portfolio.

Arar says the infrastructure portfolio “continues to deliver strong, consistent performance across a range of market conditions” even amid the rapid expansion in new markets.

“This performance is a result of how we invest,” says Arar. “Our approach favours core+ strategies where performance is driven by operational strength and not speculative growth.”

Even though some of its latest infrastructure investments have been in sectors driven by high growth expectations that have sometimes struggled to materialise, from renewables to fibre networks, the executive insists Mubadala has kept a disciplined approach and focused on businesses “that have strong fundamentals and provide essential services”.

“These are core, income-generating assets with long-term contracts and predictable cash flows which are designed to hold their value even as there are broader market shifts,” says Arar.

The sovereign wealth fund has also started to make its first infrastructure exits to return some capital.

Arar points to UK smart meter provider Calisen as a “key milestone” for Mubadala and a successful exit.

Mubadala, alongside BlackRock and Goldman Sachs, bought the company in 2020 for GBP 1.43bn, turned it into the UK’s largest smart metering platform through a major bolt-on in 2023, and eventually exited at a valuation of about EUR 4bn.

“The investment reflected our approach of selecting the right partner, focusing on operational performance, and managing toward a well-timed, value-accretive exit that left the business well placed for future growth,” Arar says.

A growing number of sovereign wealth funds that have typically focused on amassing large infrastructure portfolios are now starting to sell assets more frequently to manage their portfolio.

Mubadala’s peer ADIA for example exited UK utility Scotia Gas Networks in 2021 after five years of ownership, while Kuwait’s Wren House has also signalled its intention to put more assets on the market.

Mubadala might soon be in a position to sell more assets too, but for now Arar’s focus seems to remain firmly on increasing, rather than cutting, the Abu Dhabi fund’s infrastructure exposure.